Policy ambition and public funding don’t add up in either the short or long term – and the result spells long-term economic trouble, argue Anita Charlesworth and Richard Murray
The chancellor’s Autumn Statement came just two days before ‘Black Friday’ – the recently imported US shopping day that seems to mark the start of the Christmas season.
But anyone looking for some festive cheer should not read the Autumn Statement. It – and the accompanying economic forecast from the Office for Budget Responsibility (OBR) – provides a truly sobering summation of the economic troubles of our time.
The statistics are stark. Since 2008, productivity has stalled. As a result, real incomes have been squeezed and deficit reduction is taking longer and proving more painful than anyone expected. Combine the structural weaknesses with the uncertainty of Brexit and the result is slower economic growth – which means there is likely to be less money in the economy than we expected. As a result, the £10bn budget surplus planned by George Osborne for 2019/20 has turned into a £20bn deficit under Philip Hammond.
Full story in The HSJ 29 November 2016